Sep 2, 2010 2:00am EDT
of the conversations over the weekend. for us, it was less about -- and i understand all of the noise about crisis and bailout and morale hazard. lehman had the capital. we needed the liquidity. we had four -- we went into that last weekwith over $40 billion of liquidity, we lost close to 30 in three days. we needed the liquidity. i really cannot answer you, sir, as to why the federal reserve and the treasury and the sec together chose to not only provide support for liquidity, but also not to have opened the window to lehman that sunday night as it did to all of our competitors. i must tell you when i first heard about the fact that the window was open for expanded collateral, a number of my finance and treasury team came into my offense -- office and said we're fine. we have the collateral. we can pledge it. we're fine. 45 minutes later, they came back and said, that window is not open to lehman brothers. >> yes, that is in the chronology. all right. mr. baxter, let me follow up on this. in addition to the -- did you see political considerations in the timeline? you see the debate about the fina
Sep 3, 2010 2:00am EDT
needed that becomes too big to fail. the bill doesn't give us the authority but it does give us the authority if we despair of these other methods that we believe the firm in size and complexity is dangerous we have both of the living will requirement but also the authority regulators collectively to break up firms. i don't know the answer to that question. that is the charge congress has been -- given the regulators and we take seriously that charge. we put in place some reasonable approaches, but i appreciate your historical perspective which says over the long run you have to take into account the political influence of these large institutions. >> in terms of the will of the institutions themselves, there is a division in american industry. some industries have adopted levels of self regulation, in depth, an acceptable behavior for instance nuclear power industry has developed impressive processes. best practice and enforcement, on the other hand. they had just seen one of the manifestations. the financial community or nuclear power industry or more like deepwater drilling.